Reasons to be cheerful for EU aid?

11 February 2013

On 7-8 February, EU leaders celebrated reaching agreement over the bloc’s long-term budget. But while they are patting themselves on the back for reaching “the best possible agreement for everyone”, is that really what they’ve achieved? Is this deal one worth cheering? The answer, unfortunately, is far from clear cut.

EU aid frozen

Following two days of intensive negotiations, EU heads of state and government slashed the European Commission’s long-term budget proposal from €1031bn to €960bn. In real terms, it means the budget has been cut for the first time in the bloc’s history, down from 1.12% of GNI from 2007-2013 to 1% for 2014-2020.

The amount set aside for aid under the deal agreed by the Council is down significantly compared to the European Commission’s proposal – over 16% has been cut from the Global Europe heading (which includes development and humanitarian aid) while off-budget expenditure through the European Development Fund and Emergency Aid Reserve is also down (11% and 20% respectively). In real terms, however, EU aid has effectively been frozen at current levels.

On the one hand, this result is perhaps worth cheering – it’s certainly not as bad as it could have been, with member states in combative mood and wielding the axe apparently at will. With few outspoken development and humanitarian aid advocates among their ranks, it could quite easily have taken a much bigger hit. Many, me included, feared it would. But the question we’ve got to ask ourselves is this: is that good enough? I would argue not.

Halting progress towards poverty reduction

The European Commission’s proposal was ambitious and would have enabled the EU to play a leading role in efforts to eradicate poverty and make progress towards the Millennium Development Goals and beyond. The proposal by the European Council does not reflect this ambition and jeopardises the EU credibility and standing as a global player.

Looking at humanitarian aid alone paints an alarming picture of what’s at stake. In 2012, total humanitarian funding from the European Commission amounted to €1.3bn – in the face of increasingly frequent and intense emergencies, this is the highest annual humanitarian aid spend ever. The cuts proposed by the Council to humanitarian aid (compared to the Commission’s proposal) are the equivalent of the EU turning its back on humanitarian emergencies for over a year. To put it another way, it’s like turning a blind eye to over 150 million people facing situations of crisis.

In addition, EU leaders have repeatedly committed themselves to providing 0.7% GNI as ODA, yet all but a handful remain a long way from achieving it. The commission's proposal would have put the bloc back on track towards finally meeting that promise.

A change in strategy?

Speaking at a press conference following the summit, European Commission President José Manuel Barroso, who has spoken out strongly in support of development and humanitarian aid throughout the negotiations, hinted at a possible shift in strategy regarding development aid, saying the EU would “focus its efforts now towards the poorest countries”.

Was this a throwaway comment or something more? With money stretched, there is a constant clamour to demonstrate aid is achieving results. Do President Barroso’s remarks suggest the EU intends to “make the most” of its aid budget by focusing development spending on the poorest countries?

If so, this would seem to be a foolish strategy. While “differentiation” in aid spending is not new, aid should be focused on the poorest people, not only the poorest countries. Middle income countries are home to 70% of those living below the poverty line, and if we are to make real progress towards poverty eradication, EU aid must continue to address their needs.

What’s next?

Of course this is not the end of the story. The European Parliament must formally approve the Council’s proposal and this is far from certain: MEPs have repeatedly threatened to veto the proposal if it doesn’t reflect their concerns. Several MEPs have spoken out in support of an ambitious development and humanitarian aid in the run up to last week’s summit, including European Parliament President Martin Schulz, and with talk of a secret ballot, there is a real possibility that MEPs will reject this proposal.

So yes, EU leaders could have slashed more for the proposed aid budget when they met last week. But settling for that, frankly, would be seriously short-sighted. We will therefore continue advocating for a stronger EU aid budget which puts the lives and futures of children at its heart.